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OVERNIGHT MARKET SNAPSHOT FOR THURSDAY 23/04/20 (as at 7:15am AEST)
- SPI200 (Jun) overnight futures up 52 pts to 5289
- SP500 up 62.75 pts to 2799.31
- NASDAQ up 232.15 pts to 8495.38
- Dow Jones up 456.94 pts to 23,475.82
- FTSE100 up 129.60 pts to 5770.63
- DAX30 up 165.18 pts to 10,415.03
- GOLD futures (June Contract) up $50.70 to $1738.50 an ounce
- COPPER futures (Comex July) up $0.057 to $2.286 a pound
- OIL futures US Session (Nymex June) up $2.66 to $14.23 a barrel
- CRB Index up 4.82 pts to 111.11
- AUDUSD trading at 0.6320
- EURUSD trading at 1.0822
- GBPUSD trading at 1.2332
- USDJPY trading at 107.8100
- USD Index US Session (ICE June) up 0.103 to 100.477
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US Indexes put the pressure on recent sellers to squeeze higher as traders were again happy to be risk on in a very choppy environment. Buyers were supported by higher oil prices which managed to settle after the recent record breaking lows. Bond prices fell as safe haven traders moved out of the assets to shares….again. The idea of further stimulus also supported the action in a move that started in the Asian session. Many expect that there will be further stimulus for the US economy which could be worth up to $1.5 trillion. Expect that the large debt levels will have an adverse flow on affect longer term to interest rates (lenders will ask for higher interest to offset the risk of lending), higher taxes (to pay the debt), jobs and growth. The DOW finished up 1.99% while the broader SP500 was up 2.29% and the Nasdaq up 2.81% for the session. In Europe, stock Indexes were also buoyed by higher oil prices but we do not believe that the issue has been resolved yet and will take another turn for the worse. The positive sentiment outweighed corporate warnings and worrying forecasts as the economic damage slowly comes to light. All eyes are now on an EU summit later this week to discuss using a joint long-term budget to restart economic growth.
The USD Index came under pressure early in the European session before a sudden (planned??) spike higher that quickly erased all the losses and pushed the dollar index into positive territory. The move was helped by a positive stock market and a move lower in safe have assets. The EURUSD spiked lower once the USD started its move up and buyers are now trying to support the 1.0810 zone. If that can not hold then buyers will be looking down to 1.0765. The GBPUSD is trying to repair itself after the previous sessions nosedive. Buyers are holding minor higher levels but price may need to retest down to the lows prior to building confidence for a move up. The AUDUSD found some buying support as commodities were buoyed by the stronger USD. We still expect some choppy action into the Aussie but will be watching to see if price can hold above the 0.6265 area. The USDJPY continued to be locked between support and resistance in a range as buyers and sellers fight it out. If the 107.300 area holds and price breaks up through 108.100 then expect to see a run up to the 109.000 area.
SPOT GOLD again defied traditional logic as price rallied being supported by a lift in the USD. The push up through 1698 squeezed out sellers but price is extended so will need to pullback and reset before another move up will stick. Crude Oil prices found some support but the June contract may just be biding its time before heading to new lows again. The June contract will expire next month and face the same problems with liquidity and storage as the May contract unless things change dramatically in the next few days. We do not see that global demand will change any time soon so Oil may be under pressure for a while yet. The pledge of further oil cuts helped support the action although they may again have little affect on the supply glut until demand lifts and producers are not going to shut down due to the length of time an operation takes to restart. Copper found some buyers to support price after the recent spike lower cleared out a lot of buyers. Price is extended so some heat will need to come out of the rally before it can hold a higher level to bring in some fresh buyers.
Cryptocurrencies had a good run higher to session with some solid gains. Bitcoin is back above the 7000 mark currently trading at $7097.5 up 3.04% while Ethereum is at $182.82 up 5.75% and Ripple is at $0.18791 up 1.75%.
The ASX200 fought back from a weak open yesterday to catch a few bears off guard. At the close the index ended flat to 5221.2 after being up 30 points at one stage. It was a very choppy session with traders getting squeezed out of the action on both sides of the market. The sectors were mixed with Miners and Resource stocks getting hit the hardest while Utilities and Healthcare ended in the green. Falling stocks outnumbered advancing ones by 727 to 458 and 312 ended unchanged.
The ASX200 is expected to open up 50 points as the SPI200 continues the run up in the overnight sessions. Traders will be focused on the coming manufacturing data out today.
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ECONOMIC DATA OUT TODAY (AEDT)
AUD Flash Manufacturing PMI 9am
EUR French Flash Services and Manufacturing PMIs 5:15pm
EUR German Flash Services and Manufacturing PMIs 5:30pm
EUR Flash Services and Manufacturing PMIs 6pm
GBP Flash Services and Manufacturing PMIs 6pm
USD Unemployment Claims 10:30pm
USD Flash Manufacturing PMI 11:45pm
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SPI200 INTRADAY LEVELS TO WATCH
